ECONOMYNEXT - State-run China Export & Credit Insurance Corporation (SINOSURE) has backed a $20 million credit to Sri Lanka's Laugfs Gas group, which is building an $80 million terminal, officials said.
LAUGFS Terminals Ltd, is building the import-export liquefied petroleum gas terminal at Hambantota Port, which is on China's One Belt One Road. Hambantota port will soon be part-owned by Hong Kong-based China Port Holdings.
China Huanqiu Contracting & Engineering Corporation (HQC) is the turnkey contractor for the project.
The first 30,000MT phase of terminal is on track to be commissioned by the second half of 2018. Another 45,000MT expansion is planned.
“Once completed, the LAUGFS terminals in Hambantota will garner tremendous economic benefits to our country by helping to position Sri Lanka as a central energy hub in the region" LAUGFS Chairman W K H Wagapitiya said.
Laugfs is the second-largest LPG distributor in Sri Lanka, and is expanding operations in Bangladesh.
The $20 million credit backed by SINOSURE was arranged by Standard Chartered Bank.
“The LAUGFS LPG Terminal project will become a catalyst that contributes to the future economic prosperity of Sri Lanka," SINOSURE Deputy General Manager Guo Yilin said. "The strategic location of the terminal in the midst of the world’s largest shipping routes will undoubtedly be an enormous advantage that the company can leverage."
Jim McCabe, chief executive officer of Standard Chartered Sri Lanka, said its longstanding presence in both China and Sri Lanka made this possible. A team specializing in China was in Sri Lanka to arrange the deal.
Another $20 million for the project will come from People's Bank in Sri Lanka, and Laugfs is expecting to fund the rest with internally generated cash, Group Managing Director Thilak De Silva said. (Colombo/Aug20/2017)